Pwc Hospitality Customer Insights Us Experience Radar 2012
Transcript of Pwc Hospitality Customer Insights Us Experience Radar 2012
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Locating the sources
of value behind truly
exceptional customer
experiences
May 2012
Experience
Radar 2012Consumer insights forthe US hospitality industry
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The outsized gains experienced by the
resumption of travel activity have largely
run their course.
And, while the broader economy remains
sluggish, what can smart hoteliers do to grow
revenue and market share in a less than an
ideal economic environment?
They can do what theyand those in other
industrieshave always done: nd better
ways to remain relevant to their customers by
delivering the value sought by those guests.
Todays industry dynamism makes it all
the more important to turn good customer
experiences into loyal customers. And winning
with customers means putting them rst.
Thats why weve chose to focus on real
consumerstheir needs, wants, and
preferencesin this Experience Radar
report for the hotel industry.
This years Experience Radar report can
help industry players attract new protable
customers, help keep the ones they have,
and grow margins. After all, running a
protable business isnt just about keeping
costs down. Its about winning and serving
protable customers the best you know how.
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Experience Radar helps you locate two
elements critical to pleasing customers and
growing business: experience segments
and experience enhancers.
Experience segmentsare those natu-
ral groupings of hotel guests that appear
when respondents are categorized by the
features they value, their demographics,
and behavioral proles. Theyre who you
can build a hospitality business around.
Experience enhancersare those market
insights thatwhen translated into
practical actionscan create value forconsumer card purchasers. Theyre what
you might do to help grow your business.
Experience Radar points the way to value
and protsby identifying ways to serve the
complete range of travelers, but particularly
those seeking a hotel experience thats second
to none.
Best,
Paul DAlessandro
PwC US Customer Impact Leader
Scott D. Berman
PwC US Hospitality & Leisure Leader
About Experience Radar
PwCs Experience Radar helps businesses search out and f ind
the often hidden sources of value that drive truly exceptional,
differentiating customer experiences.
By helping those in the hotel industry rank their consumer
features by relative importance both to the paying public
and the potential economic benefit to themselves, ExperienceRadar locates opportunities to create valuepointing the way
toward both top-line growth and bottom-line results.
This years study measures the experiences of about 6,000
US consumers across 11 industries.1The Experience Radar
assigns value to a broad set of customer experience attributes
broken down into industry-specific elements and then ranked
by what target segments value most.
Our methodology employs an advanced conjoint survey
technique to reveal insights that can be honed to extreme
precision. Other, more traditional customer experience studies
typically do not t ie to hard economics like value measures,
price elasticity and churn metrics. Experience Radar does.
While the results outlined in this report are at the industry
level, PwC can use this same methodology to develop an
Experience Radar study that is customized to your business.
1 Retail (apparel, footware & consumer electronics), Retail Banking, Payments,Healthcare Provider, Health Insurance, Airlines Leisure, Airlines Business,Hotels Leisure, Hotels Business, P&C Insurance, and Life Insur ance
Experience matters.Understanding that lets hotels growrevenuenot just manage cost.
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Questions the 2012Experience Radar helpsyou answer
How can you create lastingmemories for your guests?
How can brand ambassadors
help drive growth and
profitability?
What hotel features
are guests most willing
to pay for?
How can you attract and
retain business guests?
What is the right approach
to issue resolution?
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04 Industry challenges and opportunities
06 Playing your strengths to the market
the experience segments
10 Measuring the core attributes of customer experience
24 About moments of truth
27 The big picturegrowing the bottom line
by keeping customers happy
28 PwCs commitment to the hotel industry
29 More about our methodology
26 Appendix
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Table of contents
Consumer insights for theUS hospitality industry
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Hotel industry challengesand opportunities
Travelers are back on the road, but a price gap
persists and power is shifting to consumers in
their choice of hotels. Hoteliers can differentiate
by better understanding what customers value.
Lodging sector performance continues to
benet from a return of business and leisure
guests. Hotels across the spectrum of chain-
scale segments experienced occupancy and
average daily rate (ADR) gains in 2011,
reecting the breadth of the recovery. Over-
all, hotel occupancy in 2011 recovered to
60.1 percent, just slightly ahead of its ten-year
average of 60.0 percent, and revenue per
available room (RevPAR) rose 8.2 percent.1
Yet a price gap persists, as prices in manymarkets remain below nominal peak levels.
PwCs lodging outlook anticipates continued
growth in occupancy and ADR will result
in a 6.5 percent increase in RevPAR in 2012.1
Progression in the sector has continued,
despite slower economic growth and sup-
pressed supply growth. Hotels are expected
to increasingly rely on improved pricing to
drive revenue growth.
So, where do we go from here?
The momentum of the travel rebound is
transitioning to a slower pace of expansion
in 2012. In this context, the overhang of
challenging economic conditions in the
US, and persistent risks related to the debt
crisis in Europe, can appear ready to tip
the balance toward the negative. The
implications of this outlook are two-fold.
First, it is important for industry leaders
to emphasize current priorities for
growth.For example, in markets that
are making transitions from occupancy to
rate-driven growth, operations can focuson understanding what customers want,
delivering that experience, and closing the
price gap in an attempt to optimize prot
per available room.
Second, leadership teams can ensure
downside risks receive adequate
attention.With fragile nancial
markets and slow economic momentum,
the potential for a downturn in eco-
nomically sensitive sectors such as travelremains elevated.
By balancing these two implications, and
leveraging lessons from the downturn,
sector leaders can refocus on growth in a
post-crisis world.
1 PricewaterhouseCoopersLLP. (January 23, 2012)Hospitality Directions US
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For leisure guests,ExperienceRadar can help you:
better develop products and services
that matter to your customers
target different consumer segments of
the market for education and sales
set yourself apart in a heightened
competitive environment
connect the dots between consumerexperience, customer value, and sustain-
able nancial performance
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How the ExperienceRadar can help
For business guests,ExperienceRadar can help you:
develop more relevant and more
effective programs that appeal to the
business traveler
improve the travelers perceived value
and level of engagement with current
business-guest focused programs
adapt and potentially personalizeemployee support to be more responsive
to the characteristics of the guest
segments being served
Consumer experience is quickly becoming
a differentiator when measuring the
value hotels provide, whether to leisure
or business guests.
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Hows it different?
Unlike traditional market segmentation
which is usual ly based purely on demo-graphics, Experience Segmentsthe
market segment groups identied by
Experience Radarare dened by the
types of experiences they value.
6 Experience Radar 2012 | US Hospitali ty Industry
2012 experience segments
Experience Radars
hotel segmentationleisure guests
Hows it done?
Respondents are pooled and divided into
segments based upon the hotel features theyvalue, behavioral dimensions (like usage rate
and loyalty, etc.) and some demographic data.
How can I use it?
The Experience Segments identied in this
report help you target your experience-based
offerings toward those who will value them most.
EXPERIENCESEGMENT5
EXPERIENCESEGMENT2
EXPERIENCESEGMENT3
EXPERIENCESEGMENT4
The 5experiencesegments for hotel
leisure guests
EXPERIENCESEGMENT1
High MaintenanceMark
Easy StayEmily
Price Con sciousPeter
Experience SeekingEliza
HabitualHarry
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Comparing theexperience segments
Details of leisure guestsegments HighMaintenance
Mark
(N=106, 19%)
Easy Stay
Emily
(N=139, 24%)
Price
Conscious
Peter
(N=104, 18%)
Experience
Seeking
Eliza
(N= 94, 17%)
Habitual
Harry
(N=126, 22%)
Age Gen Y (1832)
Boomer (> 50)
Gen Y (1832) Boomer (> 50) Gen Y (1832) Gen X & Y (1849)
Income > $150K $100149K $2575K $7599K < $50K
Gender Equal F emale skewed Male skewed Female skewed Male skewed
Urbanicity Suburb ofmedium city
Suburb ofmajor city
Town /Small ci ty Major ci ty Maj or ci ty
Top Attributes Quality
Accessibility
Support
Accessibility
Quality
Accessibility
Accessibility
Support
Quality
Accessibility
Top Features Premium roomamenities
Modern andnew dcor
Hassle-freeresolution
Reasonablynew dcor
Premium roomamenities
Reasonablynew dcor
Close toattractions
Hassle-freeresolution
Premium roomamenities
Reasonablynew dcor
Additional High frequency ofhotel visits andonline interaction
on an annual basis
Highest annual(+) and (-) MOTfrequency
Less pricesensitive
More swayedby personalexperience
Good and badexperiences tieddirectly to quality
of room
Least likely toshare goodexperiences
Lowest onlineand in-personinteraction with
hotels
Most likely to havenever had a goodhotel experience
Highly pricesensitive
Highest likelihoodto revisit after agood experience
Less pricesensitive
More swayed bypersonalexperience
High frequency ofhotel visits andonline interaction
on an annual basis
Highest proportionof habitualchurnersleastloyal segment
EXPERIENCESEGMENT5
EXPERIENCESEGMENT2
EXPERIENCESEGMENT3
EXPERIENCESEGMENT4
EXPERIENCESEGMENT1
EXPERIENCE
SEGMENT5
EXPERIENCESEGMENT2
EXPERIENCESEGMENT3
EXPERIENCE
SEGMENT4
EXPERIENCESEGMENT1
High Maintena nceMark
Easy StayEmily
Price Co nsciousPeter
Experie nce Seekin gEliza
Habitua lHarry
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Hows it different?
Unlike traditional market segmentation
which is usual ly based purely on demo-
graphics, Experience Segmentsthe
market segment groups identied by
Experience Radarare dened by the
types of experiences they value.
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2012 experience segments
Experience Radars
hotel segmentationbusiness guests
Hows it done?
Respondents are pooled and divided into
segments based upon the hotel features they
value, behavioral dimensions (like usage rate
and loyalty, etc.) and some demographic data.
How can I use it?
The Experience Segments identied in this
report help you target your experience-based
offerings toward those who will value them most.
The4experiencesegments for hotel
business guests
EXPERIENCESEGMENT2
EXPERIENCESEGMENT4
EXPERIENCESEGMENT1
EXPERIENCESEGMENT3
Convenience CountsCathy
Price Pla yerPatrick
Brand Consciou sBrian
Value SeekingVera
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Comparing theexperience segments
Details of businessguest segments
Convenience
Counts
Cathy
(N= 44, 16%)
Price
Player
Patrick
(N=82, 30%)
Brand
Conscious
Brian
(N= 50, 19%)
Value
Seeking
Vera
(N=94, 35%)
Age Gen X & Y (1849) Boomer (> 50) Gen X & Y (1849)
Senior (> 66)
Gen X (3349)
Income $5075K $100149K > $150K $5099K
Gender Equal Male skewed Equal Female skewed
Ethnicity White White Hispanic/Latinoskewed
Asian/A fricanAmerican skewed
Urbanicity Small city/Town Town/Small city/Suburb of
medium city
Major metro/Suburbof a major metro
Suburb of amajor metro
Top Attributes Quality
Presentation
Quality
Support
Quality
Support
Quality
Presentation
Top Features Premium roomamenities
Modern andnew dcor
Premium roomamenities
Reasonablynew dcor
Premium roomamenities
Reward Points:Earn free nightsand roomupgrades
Premium roomamenities
Reasonablynew dcor
Additional Least pricesensitive
Most driven byconvenience
ExperienceSeeker (Valuesmodern dcor,above and beyondissue resolution,and luxury bathproducts)
Likely never had abad experience
Most driven byprice or companynegotiated deals
Most likely toshare a good orbad experiencein-person or overthe phone
Most likely torecommenda hotel
Highest numberof hotel staysand heavy onlineinteraction withhotels in a month
Most driven bycompany brand/reputation
Habitual churner
Highest monthly(+) and (-) MOT
Values price,rewards andexperience
EXPERIENCESEGMENT2
EXPERIENCESEGMENT3
EXPERIENCESEGMENT4
EXPERIENCESEGMENT1
EXPERIENCESEGMENT2
EXPERIENCESEGMENT1
Convenience CountsCathy
Price Pl ayerPatrick
EXPERIENCE
SEGMENT3
Brand Consc iousBrian
EXPERIENCE
SEGMENT4
Value SeekingVera
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Experience Radarmeasures the coreattributes ofcustomer experience
The5core attributes ofhotel customer experience
e
R
H
PERSONALIZED CARE5Personalization of
customer relationships
via staff and partners
SUPPORT2Ease with which a
customer can obtain
product or service
help pre and
post purchase
ACCESS IBILI TY1Ease of accessing
and using an
offering
QUALITY3Accuracy, speed,
breadth and
value of an
offering
PRESENTATION4Aesthetics,
arrangement and
description of
the offering
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Experience Radaruncovers the impactof experiences
Leisure guestsHit your margin directly with Aces,but dont ignore the impact of the rest
Experience Radar ranks guest features by
relative importance to consumers as well as
potential economic impact on hoteliers. The chart
on the right maps each of the features measured
by their value to both groups. The features
fall into four categories thatin the world of
customer experiencewe call aces, wild cards,
table stakes,andfold.Ace features can help
you hit your margin targets, while other features
can drive emotional goodwill and generate
ancillary benets across the organization.
Leisure guests: Consumer vs. company value
1 Nice to have features with moderate to high economic returns
2 Must have features with low economic returns
3 Check in options, brand recognition, reward points, staff attitude, personal preferences, social
responsibility and hotel comparisons were also tested and fell in this quadrant. While customers do
seem to value theses features to some degree, they produce little impact on company margins.
These features may move to other quadrants in subsequent years
4 Feature generates benefits for other parts of the organization
5 Based on relative feature importance that does not consider willingness to pay measures
6 Based on willingness to pay measures
Customervalue5
High
Low
Low HighCompany value6
Location to attractionsStyle & decor
Table Stakes2
Fold3 Wild Cards4
Aces1Cancellation policy
Room amenities
Issue resolution
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Experience Radaruncovers the impactof experiences
Business guestsHit your margin directly with Aces,but dont ignore the impact of the rest
Experience Radar ranks guest features by
relative importance to consumers as well as
potential economic impact on hoteliers. The chart
on the right maps each of the features measured
by their value to both groups. The features
fall into four categories thatin the world of
customer experiencewe call aces, wild cards,
table stakes,andfold.Ace features can help
you hit your margin targets, while other features
can drive emotional goodwill and generate
ancillary benets across the organization.
Business guests: Consumer vs. company value
1 Nice to have features with moderate to high economic returns
2 Must have features with low economic returns
3 Check in options, brand recognition, staff attitude, details, personal preferences, hotel amenities and
hotel comparisons were also tested and fell in this quadrant. While customers do seem to value these
features to some degree, they produce little impact on company margins. These features may move to
other quadrants in subsequent years
4 Feature generates benefits for other parts of the organization
5 Based on relative feature importance that does not consider willingness to pay measures
6 Based on willingness to pay measures
Customervalue5
High
Low
Low HighCompany value6
Table Stakes2
Fold3 Wild Cards4
Aces1
Room amenities
Style & decor
Cancellation policy
Rewards points
Issue resolution
Location
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Experience Radar 2012 | US Hospitality Industry 13
EXPERIENCEENHANCER5
Meet business
guests needs,
drive loyalty
EXPERIENCEENHANCER
2Experience
creates a channel
through brand
ambassadors
EXPERIENCEENHANCER
1When bad
happens,x it
before checkout
EXPERIENCEENHANCER
3Create consistency
with the human touch
EXPERIENCEENHANCER4
Engage with
franchisees to
deliver a common
brand message
2012 experienceenhancers
Building (and growing)your business by designingand delivering exceptionalcustomer service
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The advent of technology is eliminating
the check-out experience,increasing
the need to solve issues when they happen
EXPERIENCEENHANCER1
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Complaint outcomes
My roomsmelled so
strongly of fresh paint
that it gave me a head-
ache...the manager denied
it was recently painted anddid nothing to remedy
the situation.
1 High income guests with Annual Income >75K USD2 Sample size for word-of-mouth ba d experience s (Leisure + Business) n = 698
When bad happens,x it before check-out
Not Satisfied
Satisfied
70%
30%
Setting things right with exceptional service can
leave a great impression. Resolve issues before
guests walk out your doors, or else the negative
repercussions on your brand can be huge.
The last impression is a lasting
impression. 66% of guests are not willing
to rebookafter a bad experience. Further-
more, they make sure their entire network
shares the same sentiment
Let guests know you want to hear about
their end-to-end experiencefrom the
issue to the resolution.Ensure guests
are satised or be ready for an unsavory
reputation to ensue
80%Guestsshare bad experiences2with otherswithin a month
Of guests who shared their
complaints with the hotel
7 and 10 were not satised
with the result of which
Over halfnether received an
apology, etc.1
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Experience is more than one-on-one
interactions, consider the impact of
whats heard through the grapevine
Harness real time information and
remedy issues at the source.
Unforgettable experiences should
dene your brand in a positive light
EXPERIENCEENHANCER1
Setting things right with exceptional service can
leave a great impression. Resolve issues before
guests walk out your doors, or else the negative
repercussions on your brand can be huge.
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When bad happens,x it before check-out
Recall of memorable hotel experiences
Consider your digital footprints affect on
memoriesTweets fade after a few days, butcomments on Trip Advisor linger for much longer
0%
25%
40%
55%
Forever15 years5 years6 month1 month1 week
Good experiencesBad experiences
Sources: American Hotel and Lodging Association,AH&LA Lodging Profi le for 2011; Experience Rad ar HotelsBusiness and Leisure; and Ted talk How the InternetEnables Intimacy by Stefana Broadbent
Make a guests problems your problem and
instill a passion for hospitality in your staff.
The consequence of not doing this well is a
scarlet letter on your brand
Almost 1.4 bad experiences
are shared with potential guests
every second1
3out of5Lifetime memoriesare bad experiences
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The world is becoming amore intimate place.
Deliver on your brand promise and
turn guests into your best marketers
The 6 degrees of separation have reduced
to just 4.7 in the digital age1. People are
more comfortable talking about their
personal interactions
EXPERIENCEENHANCER2
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1 On Facebook, its now 4.74 degrees of separation, CNN Tech, 22 November 2011
Make it possible for guests to own your brand
and create a shared experience outside your walls.
Incentivize them to re-book through your preferred
channels and drive up protability.
Experience creates achannel throughbrand ambassadors
Develop a multi-channel strategy
that allows your guests to communicate
positive impressions of your brand to
their networks
Franchisees can no longer hide
behind the brand.Bad experiences
at a property leave a digital footprint.
Follow your brands virtual worldand
stay abreast on whats happening on site
95%Guests discuss note-
worthy good and bad
hotel experiences
Over 60%discuss good experiences
in-person or over the phone, but the
use of social media for expression is
becoming increasingly common
Younger gueststraveling for
leisure use social media almost
3x older ones
Age 50+8%Age 3349
22%Age 1832
23%
98%Guestsshare good stayexperienceswith familyand friends
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Create moments that resonate with guests.
3 out of 5 leisure guestsare highly likely
to rebook after a good experience
Steer brand ambassadorsto book
via more protable distribution channels.
Online travel agencies (OTAs) are used 60%
more1than brand websites and charge com-
mission rates up to 25%2
EXPERIENCEENHANCER2
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1 Consumer booking behavior in the age of comparison shopping,HotelNewsNow.com, 31 Jan 2011: 63% used OTA vs. 39% used brand website
2 Lomanno, M.V. & Green, L. E. (2012) Dis tribution Channel Analysis:
A Guide for Hotels , An AH&L A and STR Special Repo rt. HSMAI Foundation
Make it possible for guests to own your brand
and create a shared experience outside your walls.
Incentivize them to re-book through your preferred
channels and drive up protability.
Experience creates achannel throughbrand ambassadors
Translating return guests into high
revenues requires more than just brand
loyalty. Augment the booking experience
so they want to use channels that deliver
you more prot
Decrease the distance between experience and commerce
Incentivize
pu
rchase
Mark
et
exclus
ive
off
ers
Engage
gues
ts
Driv
esale
s
with features not available
on some OTAs, e.g. flexible
cancellation
Incentivize purchase
via multiple channels
Engage guests
Experience
to more profitable channels,
e.g. brand.com and Room Key
to deepen relationships
Drive sales Market exclusive offers3xGuests are likely to have agood vs. bad experiencethroughout the year
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When on the road, guests desirea home away from home.
Empower staff to make each stay count
by consistently delivering an intimate
experience
Underemployment and the continual
drive towards efciency isjeopardizing
the opportunityto create personalized
EXPERIENCEENHANCER3
Deliver on your brand promise each time and
through every channel. Encourage staff to create
lasting memories that keep guests coming back
for more.
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Create consistencywith the human touch
experiences. Yet, it is just these experiences
that guests tend to value the most
Every guest interaction is an opportun ity.
From bell attendants to accounting staff,
hire the right people and work with
property managementteams to foster
a culture of great service
Breakdown of good experiences1
Motivate staff with incentivesand
training to enhance the guest experience
with tailored and mean ingf ul support
51%25%
19%
5%
17%
3%
Support
Quality
Presentation
Accessibility
Attentive staff
Issue resolution
Other
Over halfof memorable
leisure stay moments
are experienced due to
customized support,
largely driven by
attentive staff80%
#1Staff attentivenessranked asthe driver of a great experience1 Sample size for good experiences (Leisure) n = 261
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Gotchocolates on
my birthdaymade my
stay truly memorable
Staff treated me as if
I was the only onein the
hotelI was worry free
Received handwritten
notefrom the manager
welcoming mefelt really
special
On my rst stay, bartender
pronounced my difcult
namelike he knew me all
my life!
It doesnt take too much to make a guest
feel special. Simple things can go a
long wayin making a stay memorable
Make the memorable repeatable.
Enable seamless communication among
staff to deliver a great experience over
time and across multiple channels to
build loyalty
EXPERIENCEENHANCER3
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Create consistencywith the human touch
Hotelstaff shipped a presentto my4-year old son, whose birthday
I was missingtheyve earned
my business for life!
Be especially courteous to those who travel
frequently76% of all guests who stay
at hotels on a monthly basisare likely
to rebook at properties where theyve had a
noteworthy experience
The payoff from repeat business is
signicant.Do the business case at the
property as well as brand level, and go the
extra mile to realize the returns
Deliver on your brand promise each time and
through every channel. Encourage staff to create
lasting memories that keep guests coming back
for more.
65%of all guests are likely to re-bookhotels where theyve had a great experience.
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A brand serves as a seal of quality,as well as a lifestyle statement.
Connect with franchisees meaningfully
and deliver a familiar experience at every
property touting your name
Brands provide guests comfort
that their needs will be taken care of
EXPERIENCEENHANCER4
Different standards of cleanliness and guest
support across properties can tarnish a hotels
brand image. Connect with franchisees and tie
standards to attributes guests care about.
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Engage with franchiseesto deliver a commonbrand message
Whether in the US or abroad,
I stay at this one brand of
hotelI can always be sure
of welcoming,white linens and
a clean comforter on the bed
Guests brand preference
Middle-aged guestsin particular
prefer a strong hotel brand, possibly
because they have families and are
risk averse when it comes to vacations
Customervalue
Feature improvements
None
Mainstream or chain
Niche
Once guests know what to expect on
the basics, their choice of brand serves
as an expression of their identity
or lifestyle
3out of 5of all guests value a hotel
with a well recognized brand
1.2xGen X (ages3349) leisure guests
value a brand than other
generations
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Inconsistent experiences across
properties lead to an inconsistent
brand experience.Engage with
franchisee owners to hire and train
employees and instill common values
EXPERIENCEENHANCER4
Bad experiences1
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Be prompt with feedback to franchisees
and tie it to attributes that guests really
care about. Provide swift support such
that actionable recommendations
can be applied in real-time at the property
Encourage local innovation andshare
best practicesacross properties through
use of technological and digital capabilities
1 Sample size for bad experiences (Leisure) n = 316
Engage with franchiseesto deliver a commonbrand message
I love the chain, but this
hotel was a disaster!
Different standards of cleanliness and guest
support across properties can tarnish a hotels
brand image. Connect with franchisees and tie
standards to attributes guests care about.
5/10involve cleanliness concerns
2/10involve poor staff attitudeand support
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24 Experience Radar 2012 | US Hospitali ty Industry
Moments of truth
Powerful events in the
lives of consumers thatoften dene their opinionof a hotel property
37%attribute good experiencesto attentive staff
A positive moment of truth (MOT)can
create a loyal customer
attribute bad experiences
to cleanliness issues50%On the ip slide, create a negative moment
of truthand you have a brand detractor.
The words used most often by those describinga positive moment of truth
The words used most often by those describinga negative moment of truth
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Gone are the days when procure-ment overlooks business guestspreferences.
In todays world its all about crafting the right
experience. The reward is loyal customers
EXPERIENCEENHANCER5
It pays to have a loyal business guest. Understand
the specic needs and preferences of the business
guests you host, and provide the best possible
experience at the price you command.
25 Experience Radar 2012 | US Hospitali ty Industry
Meet business guestsneeds, drive loyalty
Deliver on the price-to-value
relationshipspecic to those working
on the road. Business guests value
premium amenities, but unlike leisure
guests, want them included in the
standard offering
#
1Business guests rank
personal experienceas their
top purchase driver
Business guests
value room amenities5xover
hotel amenities
Dont rely on the guests employer
to make the sale.Understand guests
preferences and appreciate what shapes
the experience
Create the best possible experience
at the right price.Companies name the
budget, but employees have the nal say
on where they stay
84%Business guestsvaluepremium room amenitiessuch as wi- and HDTV
businessguests
0%leisure guests30%
Premium guests will pay for
top tier hotel and room amenities
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Earn a greater return with your business
guests.A satised guest is loyal
and will spread the wordto friends
and colleagues
EXPERIENCEENHANCER5
26 Experience Radar 2012 | US Hospitali ty Industry
Connect with business guests to understand
how to make a home away from home.
Deliver an experience that ensures a
return visitand secures the brand as a
preferred choice
Meet business guestsneeds, drive loyalty
I was late checking in after a minor
accident. I was upgraded to a suite and
had my favorite drink waiting for me
They earned my loyalty for life.
Increased margins & revenue
It pays to have a loyal business guest. Understand
the specic needs and preferences of the business
guests you host, and provide the best possible
experience at the price you command.
Returnbusiness
Increased margins& revenue
Word of mouth
Experience
Business vs. leisure preferenhanced reward programs1
1.8x
Share good experiences withina week of occurrence comparedto 2 out of 5 leisure travelers
3 out of 5
Highly likely to rebookafter a good experience,compared to only 60%of leisure travelers
70%
1 Enhanced rewards programs, e.g. flexible check in/out options
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27 Experience Radar 2012 | US Hospitali ty Industry
The big picture
Growing the bottom line
by keeping customers happy
Identifying profitable revenue growth
Improving customer experience and driving loyalty
Matching customer needs to the rightproducts and channels
Revise global strategy
Simulate customer response to changesprior to investment
Refine channel strategy and optimize distribution
1
Create needs-based segmentation
Engage customers via two-way communication
channels, including social media
Develop franchisee selection and training strategy
Ineffective targeting
Increasing customer engagement
Complexities in marketing due to franchise model
2
Understand your global customer andtrack preferences
Refine global operations and distribution strategies
Operating profitably in diverse global markets
Lack of personalization
Complexities in operation due to fragmented distribution
3
Develop Voice of the Customer program to uncoverproduct, servicing and marketing insights
Centralize customer information into single view
Inability to uncover customer issues
Multiple and disparate views of customers
4
5 Institute a governance model and deliver consistentbrand message
Develop metrics and incentives structure
Empower staff to own issue resolution
Inconsistent customer experience acrosschannels and properties
Staff behavior not aligned with brand goals
Ineffective support when issues arise
Sales&M
ark
etin
g
Tech
nolo
gy
&
Opera
tio
ns
Strate
gy
Ana
lytics
Organization
1
5
2
34
Issues Recommendations
So, just how might all of
this t together?Heres one
attempt at a game plan that
pulls it all together.
How to address your challenges
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Understanding the wants and needs of
todays guests points the way toward
competitive advantage. PwCs values-base
approach to getting inside the minds of the
consumercoupled with a quantitative
DNA that lets us examine experiences with
an economic ltercan be the difference
between simply listening to customers
and truly getting to know them. Let us
collaborate with you to design and deliver
differentiating customer experiencesthat put guests at the very center of your
organization.
From strategy through execution, PwCs
Advisory ser vices help clients bui ld their
next competitive advantage. We combine
the breadth of knowledge of over 33,000
global professionals with deep industry
knowledge to deliver custom solutions for
our clients. A long history of auditing many
of the worlds largest and most complexcompanies means we really understand
the unique business challenges our clients
face better than most consultancies.
28 Experience Radar 2012 | US Hospitali ty Industry
PwCs commitmentto the hospitalityindustry
PwCs Customer Impact professionals work
with companies across a range of industries
to help them understand how customer wants
and needs point the way toward competitive
advantage.
PwCs Hospitality & Leisure professionals
are sector-specic specialists focused
on assisting clients to create value and
manage risks. With such trusted experience
in the sector, and the latest techniques to
track consumer insights, PwC is committed
to advising leading hospitality companies
to serve tomorrows guests.Understandingthe wants
and needs of both leisure and
business travelers points the way
toward competitive advantage.
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30 Experience Radar 2012 | US Hospitali ty Industry
Appendix
The different segments
Business guests
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31 Experience Radar 2012 | US Hospitali ty Industry
Meet High MaintenanceMark
High Maintenance Mark, having the highest income and showing
a high frequency of hotel stays and online interaction, is the least
driven by price, and is the most likely to form a long-lasting positive
or a negative impression based on his stay experience.
EXPERIENCESEGMENT1
AGE
Gen Y (1832)
Boomer (>50)
URBANICITY
Suburb of medium city
TOP FEATURES
Premium room amenities
Modern and new dcor
INCOME
> $150K
TOP ATTRIBUTES
Quality
Accessibility
ADDI TIONAL
High frequency of hotel
visits and online interact ion
on an annual basis
Highest annual (+) and (-)
MOT frequency
Less price sensitive
More swayed by personal
experience
GENDER
Equal
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32 Experience Radar 2012 | US Hospitali ty Industry
Meet Easy Stay
Emily
Easy Stay Emily is young and afuent, and likes to have a
comfortable, hassle free stay when away from home. She expects
the quality of the room to be top notch, but is not so likely to talk
about a great experience with family and friends.
EXPERIENCESEGMENT2
AGE
Gen Y (1832)URBANICITY
Suburb of major cityTOP FEATURES
Hassle-free resolution
Reasonably new dcor
INCOME
$100149K
TOP ATTRIBUTES
Support
Accessibility
ADDI TIONAL
Good and bad experiences
tied directly to quality of room
Least likely to share good
experiencesGENDER
Female skewed
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33 Experience Radar 2012 | US Hospitali ty Industry
Meet Price ConsciousPeter
Price Conscious Peter is a baby boomer whos likely to like in a
small town. Hes stays at hotels for leisure only occasionally.
Hes also extremely price sensitive and has probably never had
a truly memorable hotel experience.
EXPERIENCESEGMENT3
AGE
Boomer (> 50)URBANICITY
Town/Small cityTOP FEATURES
Premium room amenities
Reasonably new dcor
INCOME
$2575K
TOP ATTRIBUTES
Quality
Accessibility
ADDI TIONAL
Lowest online and in-person
interaction with hotels
Most likely to have never
had a good hotel experience
Highly price sensitive
GENDER
Male skewed
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34 Experience Radar 2012 | US Hospitali ty Industry
Meet ExperienceSeeking Eliza
Experience Seeking Eliza is a young, environmentally conscious,
city-bred individual that values experience above all when it comes
to her leisure travel, and is most likely to re-book at hotels where
she has had a great experience.
EXPERIENCESEGMENT4
AGE
Gen Y (1832)URBANICITY
Major cityTOP FEATURES
Close to attractions
Hassle-free resolution
INCOME
$7599K
TOP ATTRIBUTES
Accessibility
Support
ADDI TIONAL
Highest likelihood to revisit
after a good experience
Less price sensitive
More swayed by personal
experience
GENDER
Female skewed
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35 Experience Radar 2012 | US Hospitali ty Industry
Meet HabitualHarry
Habitual Harry frequently travels out of town for leisure, and plans
or books a large part of his travel online. He is primarily driven by
price, and is the most likely to switch to a hotel that provides him
the best value, even when he has had a great stay experience.
EXPERIENCESEGMENT5
AGE
Gen X & Y (1849)URBANICITY
Major cityTOP FEATURES
Premium room amenities
Reasonably new dcor
INCOME
< $50K
TOP ATTRIBUTES
Quality
Accessibility
ADDI TIONAL
High frequency of hotel visits
and online interaction on an
annual basis
Highest proportion of habitual
churnersleast loyal segment
GENDER
Male skewed
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Appendix
The different segments
Leisure guests
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37 Experience Radar 2012 | US Hospitali ty Industry
Meet Convenience
Counts Cathy
Convenience Counts Cathy is the least driven by price and most by
convenience. She is an experience seeker, valuing modern dcor,
luxury bath amenities and enhanced issue resolution, and has most
likely never had a bad experience worth remembering.
EXPERIENCESEGMENT1
AGE
Gen X & Y (1849)URBANICITY
Small city/TownTOP FEATURES
Premium room amenities
Modern and new dcor
INCOME
$5075K
TOP ATTRIBUTES
Quality
Presentation
ADDI TIONAL
Least price sensitive
Most driven by convenience
Experience Seeker (Values
modern dcor, above and
beyond issue resolution, and
luxury bath products)
Likely never had a
bad experience
GENDER
Equal
ETHNICITY
White
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38 Experience Radar 2012 | US Hospitali ty Industry
Meet Price PlayerPatrick
Price Player Patrick is an afuent, yet extremely price sensitive baby
boomer. He stays at properties that his company has negotiated deals
with, and values premium room amenities and a modern dcor. He
loves sharing his stay experiences with family and friends in-person
or over the phone, and often ends up recommending the hotels
where he has had a great time.
EXPERIENCESEGMENT2
AGE
Boomer (> 50)
URBANICITY
Town/Small city/
Suburb of medium city
TOP FEATURES
Premium room amenities
Reasonably new dcor
INCOME
$100149K
TOP ATTRIBUTES
Quality
Support
ADDI TIONAL
Most driven by price or company
negotiated deals
Most likely to share a good or
bad experience in-person or over
the phone
Most likely to recommend a hotel
GENDER
Male skewed
ETHNICITY
White
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Meet Brand ConsciousBrian
Brand Conscious Brian has the highest income and highest frequency
of hotel stays and online interaction, and is the most likely to form a
long-lasting positive or a negative impression based on his stay expe-
rience. Despite being extremely brand and image conscious, he is not
loyal to any particular brand, and often changes hotels frequently,
based on the brand currently offering the fastest path to free nights.
EXPERIENCESEGMENT3
AGE
Gen X & Y (1849)
Senior (> 66)
URBANICITY
Major metro/Suburb
of a major metro
TOP FEATURES
Premium room amenities
Reward Points: Earn free nights
and room upgrades
INCOME
> $150K
TOP ATTRIBUTES
Quality
Support
ADDI TIONAL
Highest number of hotel stays
and heavy online interaction
with hotels in a month
Most driven by company brand/
reputation
Habitual churner
Highest monthly (+) and (-) MOT
GENDER
Equal
ETHNICITY
Hispanic/Latino skewed
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40 Experience Radar 2012 | US Hospitali ty Industry
Meet Value SeekingVera
Value Seeking Vera, having the highest population of middle-aged
business guests, seeks the hotel offering the best value in terms of
price, convenience and reward points.
EXPERIENCESEGMENT4
AGE
Gen X (3349)
URBANICITY
Suburb of a major metro
TOP FEATURES
Premium room amenities
Reasonably new dcor
INCOME
$5099K
TOP ATTRIBUTES
Quality
Presentation
ADDI TIONAL
Values price, rewards and
experience
GENDER
Female skewed
ETHNICITY
Asian/African A merican
skewed
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While the results outlined in this reportare at the industry level, PwC can use the
same methodology weve used here to
develop a customized Experience Radar
study and uncover opportunities to
accelerate your business.
If youd like to disc uss these n dings or
how PwC can help you apply them to your
business, contact:
Paul DAlessandro
(312) 298-6810
Scott D. Berman
(305) 375-6210
41 Experience Radar 2012 | US Hospitali ty Industry
We hope these insightsprove useful to yourbusiness
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